Anil Bokil, the founder of ArthaKranti Prathisthan, said a comprehensive study needs to be carried out to understand the effects of their proposals at micro level, on all segments of society and the economy. Only the govt has the wherewithal and the resources necessary for conducting such an exercise.

11 Harshada Building, Rambag Colony, Paud Road, Kothrud, in suburban Pune. That is the nondescript office-cum-residence of the now famous demonetisation man Anil Bokil. But his neighbours hardly know the man and his humble home. After reaching the address and within few furlongs away from the place, I asked a well-heeled lady and a gentleman for the famous man’s residence who had met the prime minister Narendra Modi and impressed him no end. But they just did not know the man and went their way passing by the same road where a small building Harshada is located. When a college student came out of that very building on his motorcycle, I asked him for Anil Bokil. He too was neither familiar with him nor with his organisation. When I called on his mobile, a volunteer opened the window from the second floor and peeped out smiling.

“We are here for the last six years but nobody knows us,” says Bokil, 53, who welcomed me into his spartan rented office with two tables with computers, two full time volunteers and one part time volunteer. “It is only after the prime minister’s demonisation of Rs 500 and Rs 1,000 bank notes, we have come into the limelight,” says the small-built wiry bachelor, who founded ArthaKranti Prathisthan or Economic Revolution Foundation in 2005, as we sit down on two plastic chairs facing each other for the interview.

A few minutes into the conversation, the son of retired teacher-parents from Latur city in Marathawada region, infamous for hundreds of distressed farmers’ suicide in Maharashtra, comes across as a fully possessed man of his mission. He lives on Rs 3,500 he gets from his 80-year-old retired teacher-mother, who lives with her husband in Latur city. It would not be far from the truth to call him Sanyasi of sort, as he has renounced the world, shut his bank account, lives on good will of the people and devoting his life entirely for a new economic order in the country with a band of about 25 dedicated likeminded people he won over during the last 16 years.

He says he is “rich” with the goodwill of the people towards his mission. He owns nothing. Bokil moved into 1,300 sq ft rented apartment at Harshada building in 2000. ArthaKranti Prathisthan pays Rs 25,000 rent per month, out of which Rs 8,000 is collected from an artist tenant, who also draws pics and makes posters for the organisation. “We neither welcome nor reject Modi’s scrapping of the high denomination bank notes of Rs 500 and Rs 1,000 on November 8 from our money system,” Bokil says dispassionately. The prime minister has taken just a part of our five-point programme to establish a “taxless and less cash economy”, he says. But the manner of execution is different from his NGO. “We want solution for the economic system of the country and not a punishment,” he says, adding that he accepts the present demonisation move in a positive spirit as a responsible citizen.

“The prime minister has started the process, we are now expecting the rest of our programme presented to him to be adopted to usher in truly a taxless and less cash economy,” Bokil, who does not believe in God but “divine consciousness”, says with deep conviction.

It was in July 2013, a core team of five members led by Bokil met the BJP’s officially declared prime ministerial candidate and Gujarat chief minister Narendra Modi at Ghandhinagar about three years ago. Modi swept the general polls and was installed as PM in 2014.

“We were given just 10 minutes and once I started my presentation, the meeting lasted for over two hours,” Bokil recalled. The presentation included the following:

The mission of ArthaKranti Prathisthan, a registered trust, is “an economic revolution: a way towards Principled, Prosperous and Peaceful living”. Its core five-pronged strategy to be implemented in toto without any fundamental changes or dilution is:

- Withdrawal of existing taxation system completely except customs/ import duties. That is all Central, state and local government taxes – direct and indirect.

- Every transaction routed through a bank will attract certain deduction in appropriate percentage as Transaction Tax, i.e, single point tax deducted at source (say 2 per cent). This deduction is to be effected on receiving/credit account only, the deducted amount is to be credited to different government level like Central, state and local (say, 0.7, 0.6 and 0.35 per cent respectively), the transacting bank will also have a share (say 0.35 per cent) in the deducted amount as the bank has a key role to perform.

- Withdrawal of high denomination currency.

- Cash transaction will not attract any transaction tax.

- Government should make legal provisions to restrict cash transaction upto a certain limit, say Rs 2,000. This means, cash transactions above this limit will not enjoy any legal protection.

“This proposed system can be brought force without any major change in the Constitution. It is also a truly benevolent and fair system, in line with the basic socialistic philosophy of the nation,” Bokil emphasises. He says since this is the first time such a system will come into existence anywhere in the world, the course of action for the Modi government will need to be carefully planned in a phased manner. “A clear time frame will have to be determined and conveyed to all for the phases of implementation,” he says.

According to Bokil, a comprehensive study would have to be carried out to understand the effects of the ArthaKranti proposals on the micro level, on all segments of society and the economy. “Only the government has the wherewithal and the resources necessary for conducting such an exercise,” he says candidly.

Apart from that banks would have to invest in technology for efficient management and infrastructure for deeper penetration into areas of low presence. “This would be a long-term process and banks will have to plan their strategies accordingly,” Bokil elaborates. Citizens would also have to be informed about the new system over a certain period through the use of every possible means and through the media. Moreover, a nationwide effort would have to be made using all existing administrative networks to issue PA numbers/social security numbers and cards to each and every citizen. “This process has already been initiated by the Central government under the Unique Identification Number Scheme,” Bokil points out.

On implementing his proposal, he says abolition of the existing tax system would have to be done with the effect from a single predetermined date. Simultaneously, the deducting bank transaction tax from all bank transactions would commence. “Currency notes of denomination higher than Rs 50 will be phased out in a time-bound manner. All this money will attract the standard deduction of bank transaction tax and the balance will be treated as legitimate wealth thereafter,” Bokil says, adding that regulations governing cash transactions would also come into force.

“The magnitude and time of revenue generation by this system needs to be anticipated,” he says, pointing out that initially there would be huge deposits of cash of high denomination into banks, and there would be a huge inflow of revenue throughout the phase of currency compression. “The day when currency compression is completed and Rs 50 is the highest denomination in force, all currency money can be assumed to have come back into the system,” Bokil says. Thereafter, all subsequent bank transactions would yield bank transaction tax and the government would receive revenue in a continuous stream, round the clock, round the year, he adds.

Also, the effects of these steps would need to be carefully monitored and fine-tuning action would have to be taken as and where required, Bokil says, adding that tools of monetary governance would have to be judiciously used to control inflation.

“Post implementation, a strict watch would have to be maintained on government spending. The highest degree of transparency will have to be brought into all government spending decisions,” Bokil says, adding that the equity, simplicity and economy of this system are self-evident at the conceptual level itself.

The turning point in Bokil’s life came in 1995, when a group of 86 skilled carpenters, welders, foundry men, blacksmiths, electricians etc, were refused credit by a local bank in Aurangabad city in Maharashtra. Bokil, who at that time was manufacturing import-substitutes for processing and manufacturing industry, learnt of their plight, studied their case deeply and prepared and presented their project report to the local cooperative bank. “It gave credit in the Rs 50,000 to Rs 2 lakh range,” Bokil says. Within two years state-owned Bank of Maharashtra and Bank of Hyderabad also lent funds out of which, Bokil purchased a 2-acre plot from Maharashtra Industrial Development Corporation in Aurangabad and set up an industrial cluster model. In five years, it became so successful that Bangladeshi Muhammad Yunus, a social entrepreneur, banker, and economist, and the recipient of Nobel Peace Prize for founding the Grameen Bank and pioneering the concepts of microcredit and microfinance, wanted to replicate it in his country. “A young entrepreneur, who set up a foundry unit there today owns a BMW, not a small achievement,” Bokil points out.

Since 1995, when the bank refused credit to 86 skilled men, who wanted to venture into business, Bokil’s long journey to find solutions for macroeconomics started. The mechanical engineer by profession met many economists, chartered accountants to understand why everyone does not have access to banks, why they cannot get loans from the banks, why capital is expensive and so on and so forth. After a deep study along with some likeminded people from Aurangabad and Pune, he came up with the ArthaKranti strategy in 1999 and invited people to join him.

“I met him in 2007 for an interview which was carried in Sakaal Marathi daily with a headline ‘Farmers’ suicide will halt with total economic revolution’ which become an instant hit,” Yamaji Malkar, former editor of Sakaal for 10 years, told Financial Chronicle. He is one of the 11 trustees of ArthaKranti Prathisthan. He quit Sakaal in 2009, and joined Bokil full time. For the last six years, he has been editing Arthapurna monthly magazine, propagating Bokil’s economic revolution for the country. “The magazine runs on contribution,” says Malkar, who, like Bokil, also does not believe in God. Married to a classical singer with two college-going daughter and son, he earns his living by freelancing. He is one of the right hand man of Bokil, writing extensively on ArthaKranti in various Marathi newspapers and magazine and on a lecture circuit with Bokil to various groups, institutions and associations across the country.

“Bokil also met Rahul Gandhi in 2013 in Delhi,” Malkar, 52, said. But nothing came out of it. He also met Pratibha Patil, the then governor of Rajasthan in March 2007, who, impressed with his work, wrote to Somnath Chatterjee, the then Speaker of Lok Sabha, urging him to give the ArthaKranti team an opportunity to present their model before members of Parliament. Since then, this team has been trying to influence politicians.

“I heard his lecture in Aurangabad in 2007 and I fell in love with his ideas and ideology,” Prashant Desphand, 49, a successful hotelier from Aurangabad, who has joined the organisation full time, told FC. He has shut down his three vegetarian restaurants in Aurangabad and earns Rs 25,000 a month as rent from his rented commercial shop. “This is a movement and I want to devote my life for it,” Deshpand, married with two college-going sons, said. He assists Bokil full time in Pune.

Bokil’s only passion is to see his dream come true. “This is a movement. We are not an organisation as such. We are a movement and sooner or later it will catch on,” he says. No wonder he has remained a bachelor, shunning everything, even money except ArthaKranti.

Anil Bokil leads a spartan life, lives on Rs 3,500 per month, and has devoted his life for a new economic order in the country.

Eleven, Harshada Building, Rambag Colony, Paud Road, Kothrud, in suburban Pune. That is the office-cum-residence of the now famous demonetisation man Anil Bokil. But his own neighbours hardly know the man and his humble home. After reaching the address and a few furlongs away from the place, I asked a well-heeled lady and a gentleman for the residence of the man who had met Prime Minister Narendra Modi and impressed him no end. But they did not know the man and went their way, passing by the same road where a small building Harshada is located. When a college student came out of that very building on his motorcycle, I asked him for Anil Bokil. He, too, did not know him or the name of his organisation, and kicked off.

Several enquiries yielded no result, as no one seemed to know the man nor his organisation. It was only when I called his mobile that a volunteer opened the window from the second floor of the building and peeped out at me, smiling. “We are here for the last six years, but nobody knows us,” says Bokil, 53, who welcomed me into his spartan rented office. Inside were two tables with computers, two full-time volunteers and one part-time volunteer. “It is only after the Prime Minister’s demonetisation of Rs 500 and Rs 1,000 bank notes that we have come into the limelight,” says the small-built wiry bachelor, who founded the ArthaKranti Prathisthan or Economic Revolution Foundation in 2005.

Man on a mission

The son of retired teachers from Latur city in Marathawada region, infamous for hundreds of distressed farmers’ suicides, Bokil comes across as a fully possessed man on his mission. He lives on Rs 3,500 he gets from his 80-year-old retired teacher-mother, who lives with her husband in Latur. He is a sanyasi of sorts, as he has renounced the world, shut his bank account, lives on the goodwill of people and has devoted his life for a new economic order in the country, with a band of about 25 dedicated, like-minded people he won over during the last 16 years.

He says he is rich with the goodwill of the people towards his mission. He owns nothing. Bokil moved into a 1,300 sq ft rented apartment at Harshada Building in Pune in 2000. ArthaKranti Prathisthan pays Rs 25,000 rent per month, out of which Rs 8,000 is collected from an artist tenant, who also draws pictures and makes posters for the organisation.

Turning point

The turning point in Bokil’s life came in 1995 when a group of 86 carpenters, welders, blacksmiths, electricians, etc. who wanted to venture into business, were refused credit by a bank in Aurangabad, Maharashtra. Bokil, who at that time was manufacturing import-substitutes for the processing and manufacturing industry, learnt of their plight, studied their case, and prepared and presented their project report to the local cooperative bank. “It gave credit in the Rs 50,000 to Rs 2 lakh range,” Bokil says.

Within two years, state-owned Bank of Maharashtra and Bank of Hyderabad also lent funds, from which Bokil purchased a 2-acre plot from Maharashtra Industrial Development Corporation in Aurangabad and set up an industrial cluster model. In five years, it became so successful that Bangladeshi Muhammad Yunus, a social entrepreneur and banker — and recipient of the Nobel Peace Prize for founding the Grameen Bank and pioneering micro-credit and micro-finance — wanted to replicate it in his country. “A young entrepreneur, who set up a foundry unit there today owns a BMW, not a small achievement,” Bokil points out.

Looking for solutions

Since 1995, Bokil met many economists and chartered accountants to understand why everyone doesn’t have access to banks, why they cannot get loans or why capital is so expensive. After a deep study with a few like-minded people from Aurangabad and Pune, he came up with the ArthaKranti strategy in 1999 and invited people to join him.

Gathering momentum

“I met him in 2007 for an interview which was carried in Sakaal Marathi daily with a headline ‘Farmers’ suicide will halt with total economic revolution’, which became an instant hit,” says Yamaji Malkar, the former editor of Sakaal for 10 years. He is one of the 11 trustees of ArthaKranti Prathisthan. He quit Sakaal in 2009 and joined Bokil full-time. For the past six years, he has edited the Arthapurna monthly magazine, propagating Bokil’s economic revolution. “The magazine runs on contributions,” says Malkar. Married to a classical singer with two college-going daughters and a son, he earns his living by freelancing.

He is one of the right hand men of Bokil, writing on ArthaKranti in various newspapers and magazines, and goes on lecture circuits with Bokil to institutions and associations across India. “Bokil met Rahul Gandhi in 2013 in Delhi,” says Malkar, 52. But nothing came out of it. He also met Pratibha Patil, the then governor of Rajasthan in March 2007, who, impressed with his work, wrote to Somnath Chatterjee, the then Speaker of Lok Sabha, urging him to give the ArthaKranti team an opportunity to present their model before the Parliament. Since then, this team has been trying to influence politicians.

“I heard his lecture in Aurangabad in 2007 and I fell in love with his ideas and ideology,” says Prashant Desphand, 49, a successful hotelier from Aurangabad, who has joined the organisation full time. He has shut down his three vegetarian restaurants in Aurangabad and earns Rs 25,000 a month as rent from his rented commercial shop. “This is a movement and I want to devote my life to it,” says Deshpand, married with two college-going sons. He assists Bokil full time in Pune.

Views on Demonetisation

“We neither welcome nor reject Modi’s scrapping of the Rs 500 and Rs 1,000 notes on November 8 from our system,” Bokil says dispassionately. “The Prime Minister has taken just a part of our five-point programme to establish a ‘taxless and less-cash economy’,” he says. But the manner of execution is different from his NGO. “We want solutions for the economic system of the country, and not a punishment,” he says, adding that he accepts the present demonetisation move in a positive spirit as a responsible citizen. “The Prime Minister has started the process, we are now expecting the rest of our programme to be adopted,” says Bokil.

Meeting Modi

It was in July 2013, when a core team of five members led by Bokil met the officially declared Prime Ministerial BJP candidate and CM of Gujarat, Narendra Modi at Gandhinagar in Gujarat. Modi swept the general polls and became PM in 2014. “We were given just 10 minutes and once I started my presentation, the meeting lasted for over two hours,” Bokil recalls.

Impact of his proposal

Bokil says that on implementing his proposal, abolition of the existing tax system would have to be done from a single predetermined date. Simultaneously, the deducting bank transaction tax from all transactions would commence. “Currency notes of denomination higher than Rs 50 will be phased out in a time-bound manner. All this money will attract the standard deduction of bank transaction tax and the balance will be treated as legitimate wealth,” Bokil says, adding that regulations governing cash transactions would also come into force.

“The magnitude and time of revenue generation by this system needs to be anticipated,” he says, pointing out that initially there would be huge deposits of cash of high denomination into banks, and there would be huge inflows of revenue throughout the phase of currency compression. “The day when currency compression is completed and `50 is the highest denomination in force, all currency money can be assumed to have come back into the system,” Bokil says. He adds that thereafter, all bank transactions would yield ‘bank transaction tax’ and the government would receive revenue in continuously. The effects of these steps would need to be carefully monitored and fine-tuning action would have to be taken as and where required, Bokil warns. Tools of monetary governance would have to be judiciously used to ensure inflation is kept under control, he says.

A Movement, A Dream
Bokil’s only passion is to see his dream come true. “This is a movement. We are not an organisation as such. We are a movement and sooner or later, it will catch on,” he says. No wonder he has remained a bachelor, shunning everything, even money.

Mission of ArthaKranti Prathisthan

The mission of ArthaKranti Prathisthan, a registered trust, is “an economic revolution: a way towards Principled, Prosperous and Peaceful living”. Its core five-pronged strategy to be implemented in toto without any fundamental changes or dilution is:

1 Withdrawal of existing taxation system completely except for customs/import duties. That is, all central, state and local government taxes — direct and indirect.

2 Every transaction routed through a bank will attract certain deduction in appropriate percentage as Transaction Tax, i.e. single point tax deducted at source (say two per cent). This deduction is to be effected on receiving or credit accounts only, the deducted amount is to be credited to different government level like central, state and local (say, 0.7,0.6 and 0.35 per cent respectively), the transacting bank will also have a share (say 0.35 per cent) in the deducted amount as the bank has a key role to perform.

3 Withdrawal of high denomination currency.

4 Cash transaction will not attract any transaction tax.

5 Government should make legal provisions to restrict cash transaction up to a certain limit, say Rs 2,000. This means, cash transactions above this limit will not enjoy any legal protection.

Pune-based organization Arthakranti has proposed to withdraw the existing taxation system because it is not able to generate enough revenue to cover national expenditure. Imposition of Bank Transaction Tax(BTT) will instead be an effective way to generate more revenue for government, said economist Yamaji Malkar here on Wednesday.

According to Malkar, real time gross settlement (RTGS) transaction in the country is estimated at Rs1.75 lakh crore per month and Rs2,000 lakh crore per annum. If a 2% BTT is levied on even half the annual figure, the government can easily generate Rs20 lakh crore as revenue annually, he said. This tax system will meet half the revenue requirements estimated to be around Rs40 lakh crore. In addition to this, the government can boost the revenue by not touching the current import and export taxes, he added.

Keeping the highest denomination at Rs50 will be economically viable for the country taking into consideration India's per capita income, said Malkar. In a power-point presentation, Malkar exemplified his hypothesis by tabling per capita figures of countries like United Kingdom, USA and Japan against their highest denominations.

He said that he had presented the same proposal to Narendra Modi in September 2013 when he was the chief minister of Gujarat. Modi, who was being projected as the prime ministerial candidate that time, was pleased with the proposal and had said that he would try and implement this system of taxation if he came to power, said Malkar.

Malkar also explained the rationale behind introduction of currency notes of Rs2,000. He speculated that this might be a temporary arrangement to sustain liquidity since almost 86% of the total bank notes were flushed out of the system. "I believe this denomination might be scrapped in a few years as it was introduced to mitigate the ill-effects of cash crunch," said Malkar.

"The parallel economy which funds organized crime and other antisocial practices was crippling the economy and to kill it, the government took its first step and demonetised the high value currency notes," said Malkar. He also speculated that prices of most goods and services would come down significantly, especially in real estate sector. This, Malkar opined, will allow people to buy houses without having to shell out their savings and mortgage property.